TEG.L Regulatory News (TEG)

27 Jul 2007 07:00

TEG Group (The) PLC27 July 2007 For release The TEG GROUP PLC (TEG) ("TEG" or "the Company") TEG and Glendale Announce Horticultural Joint Venture First Two Plants Confirmed for Horticultural Product Manufacture The TEG Group Plc ("TEG" or "the Company"), the AIM-listed cutting edge greentechnology company, which converts organic wastes into natural organicfertiliser, announces it has formed a Joint Venture company with GlendaleManaged Services Limited ("Glendale") - the "green services" division ofParkwood Holdings plc - to build and operate TEG Silo Cage In-Vessel Compostingplants to produce horticultural compost products. The Joint Venture ("JV") is aprogression from the collaboration between the companies that was announced on8th February 2006. The JV will be called Verdia Horticulture Limited ("Verdia") and its focus willbe on building and operating medium scale facilities, typically 10-15,000 tonnesfeed per annum to produce horticultural grade products for sale to Glendale andto regional horticultural markets. It is anticipated that Verdia will buildbetween 6 and 8 facilities over the next 2 to 3 years, geographically spreadthroughout the UK. It is anticipated that the capital required will be fundedlargely by bank finance. TEG will supply TEG Silo Cage plants to Verdia and will provide technicalexpertise and support, as well as marketing services for waste supply to theplants. Glendale will provide compost product expertise and knowledge of thehorticultural product market, together with analytical and compost productservices from its composting subsidiary, Eco Sci. Verdia will bid for mediumscale waste contracts to both Local Authorities and the private sector,sufficient to support the scale of facilities it will operate. The first two facilities are expected to be Clayland's Corner in Somerset andHill Barton in Exeter. Both sites have planning permission in place for TEG SiloCage technology. It is anticipated that construction at the sites will commencein Quarter 3 of 2007. Commenting for TEG, Chief Executive Mick Fishwick said "we see the formation ofa joint venture as a natural step forward with Glendale. Verdia offers TEG theopportunity to develop plants in a niche of the sector that we are not targetingelsewhere. The plant model is different from the traditional waste managementmodel in that there will be a greater level of value for the end product than istypical for a pure waste management facility. We have worked closely withGlendale for the last 16 months and it has become clear that our technology andexpertise fits well with Glendale's product expertise and presence in the LocalAuthority and horticultural sectors." "We have previously announced that the site we are developing at Clayland'sCorner was to produce horticultural grade products and the site fits naturallywith Verdia. It is however also pleasing that the JV immediately brings anadditional opportunity to develop a TEG plant at the Glendale site in Exeter." Commenting for Glendale, Managing Director Nick Temple-Heald said "This move ispart of Glendale's strategic plan to develop its diverse suite of green servicesto Local Authorities and the Commercial sectors." "Verdia offers Glendale a new and exciting opportunity to expand its recyclingactivities within the rapidly developing UK composting market and also providesthe ideal complementary activity to the Company's Devon based 'EcoSci' greenwaste recycling operations." "Together, Verdia and Glendale will 'close-the-loop' of biodegradable wastemanagement by developing unique, bespoke horticultural products from the newfacilities in conjunction with EcoSci's research team and returning the newproducts to high-quality end-use on local parks and gardens. " Each company will hold 50% of the equity in Verdia. The JV agreement containsthe normal change of control provisions should a third party take a 75% interestin either parent company. ENDS Contact The TEG Group Plc Tel: 01772 314100Michael Fishwick, Chief Executive Glendale Managed Services Tel: 01257 460461Ian Stephenson, Director of Recycling Adventis Financial PR Tel: 020 7034 4758/9Tarquin Edwards 07879 458 364Chris Steele 07979 604 687 Cannacord Adams (Nomad) Tel: 020 7050 6742Chris Bowman Editor's Notes: TEGTEG provides an in-vessel composting technology, which is one of the fewapproved technologies capable of treating animal by-product (ABP) waste. Planteconomics are predominantly driven by the gate fees charged, rather than thevalue of the end product (compost). The TEG process is an economic alternativeto landfill. The Silo Cage system, one of the few technologies in Europe capable of treatingthis waste, is a natural process producing compost as an end product, used as anexcellent soil conditioner that fertilises, retains moisture, provides structureand reduces the incidence of plant disease. TEG's Silo-Cages are housed inself-contained buildings, are not unsightly and are environmentally friendly. Customers include local authorities, waste management companies, foodprocessors, farmers and landowners. TEG's expanding market is driven byincreasingly stringent EU and UK legislation regulating the treatment anddisposal of organic waste. Statutory targets for the diversion of waste fromlandfill increase annually through to 2020, increasing TEG's market opportunityyear on year. The Waste Resource Action Programme estimates that 450 compostingplants will be needed by 2020 to satisfy local authority requirements alone, andthere is increasing demand from the private sector driven by ABP legislation. NOFCO is a marketing company specialising in the development of end markets forcompost products, an important aspect of all plant developments and key to localauthority development. The company has an expertise in the development ofagricultural and horticultural markets and this capability is to be provided tocustomers to enhance TEG's overall service offering. Glendale Glendale is the leading provider of specialist green service solutions and thelargest operating division within Parkwood Holdings plc. Its portfolio of green services is led by Managing Director, Nick Temple-Heald(picture available) and includes: • Glendale Countryside - incorporating Civic Trees Ltd • Glendale Grounds Management • Glendale Recycling • Glendale Golf • Glendale Horticulture - incorporating Coblands Nurseries Ltd • Glendale Environmental Glendale, formed in 1988, has a strong relationship with clients in both thepublic and private sector and operates more than 45 contracts, largely on behalfof local authorities, the Ministry of Defence and corporate clients. Glendale is a national company with a local presence. Offices are located acrossthe UK and its headquarters are at The Coach House, Chorley, Lancashire.Glendale Golf are the management company at Duxbury Park Golf Course. This information is provided by RNS The company news service from the London Stock Exchange